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The home of a second suspected American spy in Germany was searched by security agents yesterday in a deepening of the surveillance scandal that is souring relations between the allies.

The investigation into the ministry of defence employee came days after the revelation that a 31-year-old German at the BND foreign intelligence service had been arrested for allegedly selling secrets to the Americans.

Angela Merkel, the German chancellor, is coming under increasing pressure to act against Washington after President Obama refused to agree to a “no-spy” deal in the wake of claims that the US routinely spied on German communications